A fresh audit report has shown that Terra (LUNA) creator Do Kwon and the Luna Foundation Guard (LFG) spent as much as 80,000 bitcoin, which is equivalent to a stunning $2.8 billion at the current exchange rate, to preserve the dollar peg of the algorithmic stablecoin UST.
After the Luna Foundation Guard, the institution responsible with ensuring the integrity of UST, issued a technical audit report by auditing company JS Held on Wednesday, Do Kwon personally disclosed the newly discovered figures in a Twitter thread on that day.
According to the audit, the LFG spent somewhat more than 80,000 BTC to defend the UST peg, which is equivalent to $2.8 billion. In addition, the audit report said that LFG spent $613.6 from its own resources on a “net purchase basis.”
In its Twitter thread, the LFG team said that the organization was “100% supported by donations from TFL to create exogenous reserves for Terra stablecoins,” but added that the funds were “sadly inadequate” to protect the peg of the stablecoin.
According to the supplementary statement made by the LFG team, “LFG acted up to its mission entirely and did all within its resources to avert that result.”
In the meanwhile, the study provided evidence that LFG’s stated token balances, which were made public in tweets published by LFG on May 16, were correct.
According to the report, the use of estimates rather than actual transaction data in the peg defense transactions that were recounted in the LFG Tweets on May 16 did not affect the accuracy of the reported LFG balances. “The use of these estimates did not affect the accuracy of the reported LFG balances,” the report said.
LFG balances as of the 16th of May, as stated. Source: LFG audit report. “I am sorry,” said Do Kwon.
Commenting on the issue when the fresh audit report was being made public, Terra’s creator Do Kwon expressed regret for the losses that users had incurred and expressed his sincere condolences.
“I am sorry that many of you were unable to recover the significant sums of money that you invested in UST. Do Kwon replied on the report’s publication through Twitter, saying that despite the fact that the system was open source and transparent, he was responsible for creating it and should have been better able to understand and convey its hazards.
In a subsequent tweet, he explained that despite the fact that he was “wrong” about the dangers posed by UST, there was “no fraud” on his part.
“At the time, TerraForm Labs gave more than $3 billion to create [Luna Foundation Guard] in order to diversify UST’s collateral backing. At the same time, we concentrated our efforts on expanding Terra’s ecosystem. If we had believed that UST would be unsuccessful, we never would have taken these steps,” he said.
Compiled by Coinbold